Dreyfus
Institutional
Money Market Fund
SEMIANNUAL REPORT June 30, 1999
(reg.tm)
<PAGE>
The views expressed herein are current to the date of this report. These views
and the composition of the fund's portfolio are subject to change at any time
based on market and other conditions.
* Not FDIC-Insured * Not Bank-Guaranteed * May Lose Value
Year 2000 Issues (Unaudited)
The fund could be adversely affected if the computer systems used by The Dreyfus
Corporation and the fund's other service providers do not properly process and
calculate date-related information from and after January 1, 2000. The Dreyfus
Corporation is working to avoid Year 2000-related problems in its systems and to
obtain assurances from other service providers that they are taking similar
steps. In addition, issuers of securities in which the fund invests may be
adversely affected by Year 2000-related problems. This could have an impact on
the value of the fund's investments and its share price.
<PAGE>
Contents
THE FUND
- --------------------------------------------------
2 Letter from the President
3 Discussion of Fund Performance
6 Statements of Investments
11 Statement of Assets and Liabilities
12 Statement of Operations
13 Statement of Changes in Net Assets
14 Financial Highlights
16 Notes to Financial Statements
FOR MORE INFORMATION
- ---------------------------------------------------------------------------
Back Cover
<PAGE>
The Fund
Dreyfus Institutional
Money Market Fund
LETTER FROM THE PRESIDENT
Dear Shareholder:
We are pleased to present this semiannual report for Dreyfus Institutional Money
Market Fund, covering the six-month period from January 1, 1999 through June 30,
1999. Inside, you' ll find valuable information about how the fund was managed
during the period, including a discussion with senior portfolio manager,
Patricia A. Larkin.
After remaining relatively steady during the first quarter of 1999, yields on
money market securities generally rose in the second quarter in response to
expectations that the Federal Reserve Board would raise short-term interest
rates at their June meeting. On June 30, the Federal Reserve raised rates amid
stronger-than-expected global and domestic economic growth. Their objective was
to forestall a potential resurgence of inflationary pressures.
We appreciate your confidence over the past six months, and we look forward to
your continued participation in Dreyfus Institutional Money Market Fund
Sincerely,
Stephen E. Canter
President and Chief Investment Officer
The Dreyfus Corporation
July 15, 1999
<PAGE>
DISCUSSION OF FUND PERFORMANCE
Patricia A. Larkin, Senior Portfolio Manager
How did Dreyfus Institutional Money Market Fund perform during the period?
For the six-month period ended June 30, 1999, Dreyfus Institutional Money Market
Fund produced an annualized yield of 4.49% for its Money Market Series and 4.11%
for its Government Securities Series. Taking into account the effect of
compounding, the annualized effective yield was 4.59% for its Money Market and
4.19% for its Government Securities Series.(1) The fund's Money Market Series
provided a total return of 2.25%,(2) compared to the Lipper Institutional Money
Market Funds category average total return of 2.31%, while the fund's Government
Series provided a total return of 2.06%,(2) compared to the Lipper Institutional
U.S. Treasury Money Market Funds category average total return of 2.14% for the
same period.(3)
What is the fund's investment approach?
There are many factors we consider in managing the fund. We closely monitor the
outlook for growth and inflation. We follow overseas developments for any
influence they may have on the domestic economy. The posture of the Federal
Reserve Board (the "Fed") is a key determinant in our decision on how best to
structure the fund.
In addition, we actively manage the average maturity of the fund in an attempt
to take advantage of expected interest rate changes based upon our economic
outlook. If we believe that interest rates will fall, we typically lengthen
average maturity to lock in the then-current rates. Conversely, in a rising rate
environment, we typically shorten maturities to be able to reinvest at
anticipated higher rates in the future.
The Fund
<PAGE>
DISCUSSION OF FUND PERFORMANCE (CONTINUED)
As a money market fund, the fund only buys securities rated in one of the two
highest rating categories for debt obligations, or of comparable credit quality.
The fund must also maintain an average dollar-weighted fund maturity of 90 days
or less and may buy only securities with remaining maturities of 13 months or
less.
What other factors influenced the fund's performance?
Last fall, in the wake of Asian market turmoil, the Open Market Committee of the
Fed cut short-term interest rates three times in an attempt to provide liquidity
and improve investor confidence. Since then, there have been concerns that
global and domestic factors might push the United States economy towards
unsustainable growth.
As of June 30, 1999, Asian economies appear to have stabilized. What's more, the
outlook for growth in the major industrialized nations has been improving. The
domestic economy continued to move ahead briskly, evidenced by a strong rebound
in manufacturing output, which shows signs of gaining momentum. Consumer
confidence was at a 30-year high. Employment was strong, with hourly wages
rising. Despite concerns that overly rapid economic growth might lead to
destructive inflationary pressure, the Fed held interest rates steady through
all but the very end of the period. Because we managed the fund at a relatively
longer average maturity, investors have been able to benefit from stable rates
and the Fed's long-held accommodative stance during the reporting period.
What is the fund's current strategy?
Throughout the reporting period, as the economy showed robust growth, bond and
money markets anticipated a tightening of monetary policy by the Fed. Such
tightening was signaled by Chairman Alan Greenspan's mid-May announcement of a
shift in policy towards a bias to increase rates. The bias changed, in fact,
just prior to the end of the
<PAGE>
reporting period, when the Fed raised the target Federal Funds rates by
one-quarter of a point to five percent, with an accompanying return to a neutral
stance on future Federal Funds rate movement. An initial relief rally has been
replaced by a cautious "wait and see" market view.
Over the reporting period, the fund benefited from our commitment to a longer
maturity structure. When rates did not rise as quickly as markets expected,
longer maturities enhanced return. However, over the past few months, we have
taken a somewhat less aggressive stance, slowly reducing the average maturity of
our investments. In an uncertain market with the potential for further
tightening, we have adopted this approach, while still seeking opportunities to
capture additional yield as such opportunities arise.
July 15, 1999
(1) ANNUALIZED EFFECTIVE YIELD IS BASED UPON DIVIDENDS DECLARED DAILY AND
REINVESTED MONTHLY. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. YIELDS
FLUCTUATE. AN INVESTMENT IN THE FUND IS NOT INSURED OR GUARANTEED BY THE FDIC OR
ANY OTHER GOVERNMENT AGENCY. ALTHOUGH THE FUND SEEKS TO PRESERVE THE VALUE OF
YOUR INVESTMENT AT $1.00 PER SHARE, IT IS POSSIBLE TO LOSE MONEY BY INVESTING IN
THE FUND.
(2) TOTAL RETURN INCLUDES REINVESTMENT OF DIVIDENDS.
(3) SOURCE: LIPPER ANALYTICAL SERVICES, INC.
The Fund
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF INVESTMENTS-- Money Market Series
June 30, 1999 (Unaudited)
Principal
NEGOTIABLE BANK CERTIFICATES OF DEPOSIT--8.1% Amount ($) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Branch Bank & Trust Co.
5.04%, 1/10/2000 18,000,000 17,997,257
First National Bank of Maryland
5.14%, 2/23/2000 26,000,000 25,994,309
TOTAL NEGOTIABLE BANK CERTIFICATES OF DEPOSIT
(cost $43,991,566) 43,991,566
- ------------------------------------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER--42.9%
- ------------------------------------------------------------------------------------------------------------------------------------
Abbey National North America
4.97%, 12/1/1999 15,670,000 15,348,334
BankAmerica Corp.
4.96%, 10/7/1999 25,000,000 24,671,292
DaimlerChrysler NA Holdings
4.92%, 7/9/1999 25,000,000 24,973,056
Donaldson, Lufkin & Jenrette Securities Corp.
4.97%, 8/12/1999 5,000,000 4,971,358
Finova Capita1 Corp.
4.96%-5.06%, 9/24/1999-10/22/1999 26,800,000 26,413,570
General Electric Capital Services Inc.
4.97%, 10/20/1999 20,000,000 19,703,383
HSBC Americas Inc.
4.99%, 11/24/1999 25,000,000 25,001,956
Hertz Corp.
4.91%, 7/8/1999 5,000,000 4,995,285
Merita North America Inc.
5.04%, 8/11/1999 25,000,000 24,857,639
Monsanto Co.
4.94%, 10/19/1999 5,000,000 4,926,361
Paine Webber Group Inc.
5.08%, 7/6/1999 17,000,000 16,988,313
Lehman Brothers Holdings Inc.
5.40%, 8/5/1999 20,000,000 19,897,722
UBS Finance (DE) Inc.
5.60%, 7/1/1999 21,000,000 21,000,000
TOTAL COMMERCIAL PAPER
(cost $233,748,269) 233,748,269
<PAGE>
Principal
CORPORATE NOTES--24.5% Amount ($) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
Bear Stearns Companies Inc.
4.98%-5.09%, 9/15/1999-2/22/2000 23,850,000 (a) 23,876,494
CIT Group Holdings Inc.
4.87%, 9/21/1999 20,000,000 (a) 19,998,684
Ford Motor Credit Corp.
4.95%, 5/5/2000 20,000,000 (a) 20,000,000
GTE Corp.
5.20%, 6/12/2000 25,000,000 (a) 24,984,742
Heller Financial Inc.
5.00%-5.01%, 9/8/1999-4/13/2000 15,000,000 (a) 15,018,714
Paine Webber Group Inc.
5.22%-5.32%, 10/4/1999-4/20/2000 9,800,000 (a) 9,806,339
Salomon Smith Barney Holdings Inc.
5.00%, 10/28/1999 20,000,000 (a) 20,000,000
TOTAL CORPORATE NOTES
(cost $133,684,973) 133,684,973
- ------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM BANK NOTES--20.1%
- ------------------------------------------------------------------------------------------------------------------------------------
First Tennessee Bank
4.84%, 4/19/2000 20,000,000 (a) 19,993,722
First Union National Bank
5.21%, 9/24/1999 25,000,000 25,000,000
Key Bank N.A.
4.97%, 10/15/1999 25,000,000 (a) 25,002,877
Lasalle National Bank
4.91%, 10/12/1999 20,000,000 20,000,000
Old Kent Bank & Trust Co.
4.96%, 6/2/2000 20,000,000 (a) 19,989,343
TOTAL SHORT-TERM BANK NOTES
(cost $109,985,942) 109,985,942
The Fund
<PAGE>
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
Principal
TIME DEPOSITS--3.6% Amount ($) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
Republic National Bank of New York (London)
5.12%, 7/1/1999
(cost $19,644,000) 19,644,000 19,644,000
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS
(cost $541,054,750) 99.2% 541,054,750
CASH AND RECEIVEABLES (NET) .8% 4,231,500
NET ASSETS 100.0% 545,286,250
(A) VARIABLE INTEREST RATE--SUBJECT TO PERIODIC CHANGE.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF INVESTMENTS--
Government Securities Series
June 30, 1999 (Unaudited)
Annualized
Yield on
Date of Principal
U.S. TREASURY NOTES--55.3% Purchase (%) Amount ($) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
6.375%, 7/15/1999 5.35 5,000,000 5,001,536
5.875%, 7/31/1999 4.52 19,000,000 19,014,394
5.875%, 8/31/1999 4.71 5,000,000 5,008,246
5.875%, 2/15/2000 4.78 8,000,000 8,051,223
5.5%, 3/31/2000 4.66 5,000,000 5,022,748
5.5%, 5/31/2000 4.88 5,000,000 5,017,954
5.875%, 6/30/2000 5.23 3,000,000 3,014,959
TOTAL U.S. TREASURY NOTES
(cost $50,131,060) 50,131,060
- ------------------------------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--43.4%
- ------------------------------------------------------------------------------------------------------------------------------------
Bear Stearns & Co.
dated 6/30/1999, due 7/1/1999 in the amount of
$8,001,666 (fully collateralized by
$8,365,000 U.S. Treasury Strips,
due 2/15/2000, value $8,055,495) 4.80 8,000,000 8,000,000
C.S. First Boston Corp.
dated 6/30/1999, due 7/1/1999 in the amount of
$5,000,666 (fully collateralized by
$5,044,000 U.S. Treasury Notes, 5.625%,
due 4/30/2000, value $5,098,911) 4.80 5,000,000 5,000,000
Donaldson Lufkin Jenrette Securities Corp. Inc.
dated 6/30/1999, due 7/1/1999 in the amount of
$8,001,066 (fully collateralized by
$7,942,000 U.S. Treasury Notes, 7.875%
due 11/15/1999, value $8,102,081) 4.80 8,000,000 8,000,000
Goldman Sachs & Co.
dated 6/30/1999, due 7/1/1999 in the amount of
$10,320,928 (fully collateralized by
$3,950,000 U.S. Treasury Notes, 6.375%
due 6/22/2000, value $10,590,330) 3.24 10,320,000 10,320,000
Morgan Stanley & Co.
dated 6/30/1999, due 7/1/1999 in the amount of
$8,001,048 (fully collateralized by
$7,900,000 U.S. Treasury Notes, 6.875%,
due 3/31/2000, value $8,121,445) 4.72 8,000,000 8,000,000
The Fund
<PAGE>
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
Annualized
Yield on
Date of
REPURCHASE AGREEMENTS (CONTINUED) Purchase (%) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENTS
(cost $39,320,000) 39,320,000
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (cost $89,451,060) 98.7% 89,451,060
CASH AND RECEIVABLES ( NET) 1.3% 1,159,346
NET ASSETS 100.0% 90,610,406
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1999 (Unaudited)
Money Government
Market Securities
Series Series
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS ($):
Investments in securities, at value (including repurchase
agreements of $39,320,000 for the Government
Securities Series)--Note 2(b) 541,054,750 89,451,060
Cash 738,385 194,902
Interest receivable 3,795,429 984,904
Prepaid expenses 19,272 12,976
545,607,836 90,643,842
- ------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES ($):
Due to The Dreyfus Corporation and affiliates 246,636 7,780
Accrued expenses 74,950 25,656
321,586 33,436
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS ($) 545,286,250 90,610,406
- ------------------------------------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS ($):
Paid-in capital 545,323,786 90,620,282
Accumulated net realized gain (loss) on investments (37,536) (9,876)
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS ($) 545,286,250 90,610,406
- ------------------------------------------------------------------------------------------------------------------------------------
SHARES OUTSTANDING
(unlimited number of $.001 par value shares of
Beneficial Interest authorized) 545,323,786 90,620,282
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE ($) 1.00 1.00
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
The Fund
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
Six Months Ended June 30, 1999 (Unaudited)
Money Government
Market Securities
Series Series
- -----------------------------------------------------------------------------------
<S> <C> <C>
INVESTMENT INCOME ($):
INTEREST INCOME 14,272,181 1,905,932
EXPENSES--NOTE 2(C):
Management fee--Note 3(a) 1,410,213 200,719
Shareholder servicing costs--Note 3(b) 72,863 1,883
Custodian fees 34,744 14,256
Trustees' fees and expenses--Note 3(c) 31,083 5,924
Registration fees 17,728 9,849
Professional fees 16,682 20,574
Prospectus and shareholders' reports 219 --
Miscellaneous 19,732 857
TOTAL EXPENSES 1,603,264 254,062
INVESTMENT INCOME--NET 12,668,917 1,651,870
- -----------------------------------------------------------------------------------
NET REALIZED GAIN (LOSS) ON INVESTMENTS--NOTE 2(B)($): (3,181) (9,876)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 12,665,736 1,641,994
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
Money Market Series Government Securities Series
------------------------------------------- ----------------------------------------------
Six Months Ended Six Months Ended
June 30, 1999 Year Ended June 30, 1999 Year Ended
(Unaudited) December 31, 1998 (Unaudited) December 31, 1998
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
OPERATIONS:
Investment income--
net 12,668,917 27,102,277 1,651,870 3,992,120
Net realized gain (loss)
on investments (3,181) (27,774) (9,876) 10,367
NET INCREASE (DECREASE)
IN NET ASSETS
RESULTING FROM
OPERATIONS 12,665,736 27,074,503 1,641,994 4,002,487
DIVIDENDS TO
SHAREHOLDERS
FROM ($):
Investment income--
net (12,668,917) (27,102,277) (1,651,870) (3,992,120)
Net realized gain on
investments -- -- -- (10,396)
TOTAL DIVIDENDS (12,668,917) (27,102,277) (1,651,870) (4,002,516)
BENEFICIAL INTEREST
TRANSACTIONS
($1.00 per share) ($):
Net proceeds from
shares sold 1,762,978,510 3,374,356,270 395,819,514 579,548,799
Dividends reinvested 1,400,367 2,871,717 680,882 1,501,989
Cost of shares
redeemed (1,759,371,651) (3,368,354,264) (374,495,030) (620,130,251)
INCREASE (DECREASE)
IN NET ASSETS FROM
BENEFICIAL INTEREST
TRANSACTIONS 5,007,226 8,873,723 22,005,366 (39,079,463)
TOTAL INCREASE
(DECREASE) IN
NET ASSETS 5,004,045 8,845,949 21,995,490 (39,079,492)
NET ASSETS
Beginning of Period 540,282,205 531,436,256 68,614,916 107,694,408
END OF PERIOD 545,286,250 540,282,205 90,610,406 68,614,916
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
The Fund
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS--Money Market Series
The following tables describe the performance for the fiscal periods indicated.
Total return shows how much your investment in the fund would have increased
(or decreased) during each period, assuming you had reinvested all dividends and
distributions. These figures have been derived from the fund's financial
statements.
Six Months Ended
June 30, 1999 Year Ended December 31,
----------------------------------------------------------------
(Unaudited) 1998 1997 1996 1995 1994
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA ($):
Net asset value,
beginning of period 1.00 1.00 1.00 1.00 1.00 1.00
Investment Operations:
Investment income--net .022 .050 .051 .049 .054 .036
Distributions:
Dividends from investment
income--net (.022) (.050) (.051) (.049) (.054) (.036)
Net asset value, end of period 1.00 1.00 1.00 1.00 1.00 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%) 4.54* 5.14 5.17 5.03 5.57 3.65
- ------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to
average net assets .57* .57 .57 .58 .62 .63
Ratio of net investment income
to average net assets 4.49* 5.02 5.06 4.91 5.43 3.59
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period
($ x 1,000) 545,286 540,282 531,436 483,156 401,032 362,825
* ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS--Government Series
Six Months Ended
June 30, 1999 Year Ended December 31,
----------------------------------------------------------------
(Unaudited) 1998 1997 1996 1995 1994
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA ($):
Net asset value,
beginning of period 1.00 1.00 1.00 1.00 1.00 1.00
Investment Operations:
Investment income--net .020 .048 .048 .047 .052 .034
Distributions:
Dividends from investment
income--net (.020) (.048) (.048) (.047) (.052) (.034)
Net asset value, end of period 1.00 1.00 1.00 1.00 1.00 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%) 4.15* 4.87 4.95 4.84 5.36 3.49
- ------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to
average net assets .63* .68 .61 .63 .65 .69
Ratio of net investment income
to average net assets 4.11* 4.76 4.84 4.74 5.23 3.40
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period
($ x 1,000) 90,610 68,615 107,694 102,726 123,171 120,281
* ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
The Fund
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1--General:
Dreyfus Institutional Money Market Fund (the "fund") is registered under the
Investment Company Act of 1940, as amended (the "Act"), as a diversified
open-end management investment company and operates as a series company issuing
two classes of Beneficial Interest: the Money Market Series and the Government
Securities Series. The fund accounts separately for the assets, liabilities and
operations of each series. The fund' s investment objective is to provide
investors with as high a level of current income as is consistent with the
preservation of capital and the maintenance of liquidity. The Dreyfus
Corporation (the "Manager") serves as the fund's investment adviser. The Manager
is a direct subsidiary of Mellon Bank, N.A. Premier Mutual Fund Services, Inc.
is the distributor of the fund's shares, which are sold to the public without a
sales charge.
It is the fund's policy to maintain a continuous net asset value per share of
$1.00 for each series; the fund has adopted certain investment, portfolio
valuation and dividend and distribution policies to enable it to do so. There is
no assurance, however, that the fund will be able to maintain a stable net asset
value per share of $1.00 for each series.
The funds' financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management estimates
and assumptions. Actual results could differ from those estimates.
NOTE 2--Significant Accounting Policies:
(a) Portfolio valuation: Investments in securities are valued at amortized cost,
which has been determined by the fund's Board of Trustees to represent the fair
value of the fund's investments.
(b) Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Interest income is
recognized on the accrual basis. Cost of investments represents amortized cost.
Under the terms of the custody agreement,
<PAGE>
the Money Market Series receives net earning credits based on available cash
balances left on deposit. Under the terms of the custody agreement, the
Government Securities Series received net earnings credits of $1,112 during the
period ended June 30, 1999 based on available cash balances on deposit. Income
earned under this arrangement is included in interest.
The fund may enter into repurchase agreements with financial institutions,
deemed to be creditworthy by the fund' s Manager, subject to the seller's
agreement to repurchase and the fund's agreement to resell such securities at a
mutually agreed upon price. Securities purchased subject to repurchase
agreements are deposited with the fund's custodian and, pursuant to the terms of
the repurchase agreement, must have an aggregate market value greater than or
equal to the repurchase price plus accrued interest at all times. If the value
of the underlying securities falls below the value of the repurchase price plus
accrued interest, the fund will require the seller to deposit additional
collateral by the next business day. If the request for additional collateral is
not met, or the seller defaults on its repurchase obligation, the fund maintains
the right to sell the underlying securities at market value and may claim any
resulting loss against the seller.
(c) Expenses: Expenses directly attributable to each series are charged to that
series' operations; expenses which are applicable to both series are allocated
among them on a pro rata basis.
(d) Dividends to shareholders: It is the policy of the fund, with respect to
both series, to declare dividends from investment income-net on each business
day; such dividends are paid monthly. Dividends from net realized capital gain,
with respect to both series, are normally declared and paid annually, but each
series may make distributions on a more frequent basis to comply with the
distribution requirements of the Internal Revenue Code of 1986, as amended (the
" Code" ). However, to the extent that a net realized capital gain of either
series can be reduced by a capital loss carryover of that series, such gain will
not be distributed.
The Fund
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
(e) Federal income taxes: It is the policy of each series to continue to qualify
as a regulated investment company, if such qualification is in the best
interests of its shareholders, by complying with the applicable provisions of
the Code, and to make distributions of taxable income sufficient to relieve it
from substantially all Federal income and excise taxes.
The Money Market Series has an unused capital loss carryover of approximately
$34,500 available for Federal income tax purposes to be applied against future
net securities profits, if any, realized subsequent to December 31, 1998. If not
applied, $6,500 of the carryover expires in fiscal 2002 and $28,000 expires in
2006.
At June 30, 1999, the cost of investments of each series for Federal income tax
purposes was substantially the same as the cost for financial reporting purposes
(see the Statements of Investments).
NOTE 3--Management Fee and Other Transactions With Affiliates:
(a) Pursuant to a management agreement with the Manager, the management fee for
each series is computed at the annual rate of .50 of 1% of the value of the
average daily net assets of each series and is payable monthly.
(b) Under the Shareholder Services Plan, each series reimburses Dreyfus Service
Corporation, a wholly-owned subsidiary of the Manager, an amount not to exceed
an annual rate of .25 of 1% of the value of each series' average daily net
assets for certain allocated expenses of providing personal services and/or
maintaining shareholder accounts. The services provided may include personal
services relating to shareholder accounts, such as answering shareholder
inquiries regarding the fund and providing reports and other information, and
services related to the maintenance of shareholder accounts. During the period
ended June 30, 1999, the Money Market Series and the Government Securities
Series were charged $29,818 and $20,246, respectively, pursuant to the
Shareholder Services Plan.
<PAGE>
The fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of the
Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the fund. During the period
ended June 30, 1999, the Money Market Series and the Government Securities
Series were charged $47,456 and $1,950, respectively, pursuant to the transfer
agency agreement.
(c) Each trustee who is not an "affiliated person" as defined in the Act
receives from the fund an annual fee of $4,500 and an attendance fee of $500 per
meeting. The Chairman of the Board receives an additional 25% of such
compensation.
The Fund
<PAGE>
NOTES
<PAGE>
For More Information
Dreyfus
Institutional
Money Market Fund
200 Park Avenue
New York, NY 10166
Manager
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Custodian
The Bank of New York
90 Washington Street
New York, NY 10286
Transfer Agent &
Dividend Disbursing Agent
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Distributor
Premier Mutual Fund Services, Inc.
60 State Street
Boston, MA 02109
To obtain information:
BY TELEPHONE Call 1-800-645-6561
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144
BY E-MAIL Send your request to [email protected]
ON THE INTERNET information can be viewed online or downloaded from:
http://www.dreyfus.com
(c) 1999 Dreyfus Service Corporation 179/195SA996
<PAGE>
